The Olympic Games have concluded their run in Beijing. The 302 Gold Medal winners are returning to their respective countries to reflect on their experiences and their achievements. China is getting back to business (and air pollution) as usual, and the silver and bronze medal winners are reflecting on what might have been. But what are those medals really worth?
An article on the Lloyd’s website (www.lloyds.com) examines that question, asserting that the medals were “the most sought after items on the planet.” For the athletes and their fellow countrymen that’s certainly true, but what happens now?
The medals, Lloyd’s points out, are not solid gold – far from it. They are “mostly silver with only about six percent gold, but to the winners it is the most precious metal they will ever lay their hands on.”
Although the medals might not be gold, in many cases they are a passport to greatly increased wealth, ranging from performance bonuses to years of lucrative endorsements. Michael Phelps, Usain Bolt and a number of other winners are probably set for life.
This “opens up some interesting issues for insurers,” said Lloyd’s. “For while the medal may mean so much to the athlete who wins it, the insurance industry will take a pragmatic approach given the difficulty of putting a price on sentimental value.”
Richard Tolle, vice president for the Global Sport, Entertainment and Events practice at Marsh, stated: “An athlete could insure their gold medal as you would any other valuable household item that requires all risks cover. The big issue is agreeing the value of the medal with the insurance company and establishing whether a replacement is actually possible.”
It’s not the medal’s value as a commodity, which is minimal, he explained, but the “athlete’s perceived value of the medal or even the eBay price!
“If the International Olympic Committee will replace the medal, they may be able to indicate a cost to do this. Either way, the key is agreeing with the insurance company the insured value of the medal.”
Daniel Smith, director of Aon’s Fine Art and Specie team, added: “The medals can be insured on an all risks of physical loss or damage basis. The intrinsic value of the medals would be relatively low given the low price of silver. However, given the success of the games for Team GB, and with the build up to 2012, the commercial value may increase to in excess of ten fold the intrinsic value, maybe more for the likes of Rebecca Adlington [the UK’s double gold medal swimmer].”
Talking about medals in terms of commodity prices really misses the point. After all, what is a baseball worth? About $2.OO, so why do people pay hundreds of thousands of dollars for record setting home run balls, or those used to pitch a no-hitter? Their extrinsic value far outweighs the cost of the materials and labor that went into creating them.
Olympic medals are valuable because they are symbols of the individual’s, or the team’s, success. After years of training, a monastic lifestyle and the pursuit of a goal that only a select few even have a hope of attaining, they have received their reward. A medal, silver and bronze included, symbolizes that success, and, in those terms, they are priceless.
Source: Lloyd’s
Topics Excess Surplus Lloyd's
Was this article valuable?
Here are more articles you may enjoy.
Florida Insurer Can’t Object to Appraiser After the Award Is Decided, 11th Circuit Says 
Taylor Swift Cancellations Deal Blow to Insurers: Sources 
Construction Defects Are Not Covered Property Damage in Commercial Liability Policy 
Manufacturers Hit by Soaring Property Insurance Costs 
